Operating Cash Flow
Cash generated by a company’s normal business operations.
Operating Cash Flow will be distributed in the following manner:
Preferred Return -> Asset Management Fee -> Sponsor & Investor Share.
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DISTRIBUTION
WATERFALL STRUCTURE
Preferred Return
A profit distribution preference whereby profits are distributed to the investor until a certain rate of return on the initial investment is reached.
Asset Management Fee
The cost of having the assets professionally managed by Lonicera Management.
If the operating cash flow cannot cover both the preferred return and the asset management fee, the asset management fee is accrued.
Above Preferred Return
The excess after the preferred return and asset management fee are paid. Any remaining cash from the operating cash flow will be distributed according to the investor/sponsor splits.